romans holiday

Bought dollars with Asian currencies which had been appreciating against the dollar. Holding in reserve for bargain basement priced silver. It is more a hedge than a trade, so even if this is not the 180 reversal many are looking for will hold when/ if that reversal comes. Seems to me there are just too many unpredictable macro pressures on the market to be zero cash. I like to be in the zone... the comfort zone.. come what may.

The Dubai event was the catalyst I needed to finally go long dollars. Bought this morning. Will be interesting to see if this is a market changer.

Gold 1,168 Aussie down under 90... Oil down. Yen on steroids. Could get interesting.

Errr... wouldn't that be a pushup?

Yep, keeping some serious powder dry here. The Dubai debt crisis has made the market nervous... wouldn't take much more to get the risk averse trade under way. Starting to raise dollars today, Yen are getting a bit pricey now. Silver is back to where it was six months ago as priced in Yen.

Good observation. Most likely the "octopus" will fix the price of gold by fixing currencies to it. Those holding gold will still do well with gold stabilized currencies and deflating asset prices.

Nonsense.

I wasn't referring to my desires, but the collective [economic] desires of the market place. But I still do not think that something so whimsical as the market "makes sense" or is the best standard of what is "rational". I have always subscribed to the "madness of crowds" hypothesis. The only reason I own silver, is because I think the collective is going to desire it more. I reckon market psychology near always trumps "rational fundamentals".... in the short/ medium term anyway.

Yes, not going to try and time it, or sell any metals.... well, maybe a little silver.... and wait for the pullback big dip [perhaps a month or two out] before buying with dollars and Yen.

Human desires are what they are... why do they have to "make sense"?

I agree with the "It could not harm gold's long term dynamics" part. But not sure about the other part. When [for obviously "fundamental" reasons] you say "gold should have gone up" and "the sell-off was unjustified" I am left mystified. Markets do what they do [factoring in all the elements], and the moral/ rational imperative hardly comes into it... especially in the short term.... in so far as we are concerned with the momentary price. Taking other [market] forces into account, besides the "fundamentals", suggests a repeat performance at some point. Of course, this shouldn't be too alarming for the long termers where the fundamentals will finally play out.

Nice chart that. Would it be fair to say that in times of crisis the ratio rockets up [like it did last year]? If we are still in crisis mode then what's to stop the ratio rocketing up again at some point? When/if it did rocket up, I'd be swapping a hefty protion of gold to silver.

Yeah, but I think you need to look at it from an international perspective. Russia, India, China, Europe etc and then the US economy and currency within that context. A lot of discussion tends to discuss money as if it could be isolated within one nation-state [imo this is the flaw of Bill Still's program of reform]. The 19th century did perfectly well on an international gold standard. The duration of this era of globablization is pitiful in comparison and, in hindsight, was most probably just trading on "momentum" once the dollar came off gold for good.

I think it will be a matter of necessity to restore international trade, employment, and drag the world out of depression [David Rosenberg is also saying depression now]. What could really have the economists scratching their heads, is that while it took a depression for money to come off gold, it took another one for it to go back to gold.

Where the bankers and economists have stuffed up, government will have to step in. Countries will welcome it if currencies and trade becomes unstable enough..... and economies stagnate. A gold peg would also enable the Yuan to "de-peg" from the dollar with both currencies then re-pegging to the new gold backed currency at the appropriate levels. The Chinese will have their stability, and though taking a haircut on their reserves, would have the greater part of them guaranteed.

I like silver too. The ratio looks a bit stubborn in the 60s though. I feel safer in gold so will swap at around 55. Yet, will make sure to keep a few ounces of silver just in case it becomes the new gold.

It's different this time.

The ratio's are something near everyone bullish on gold can agree on. That said, it may make sense to keep some liquidity for quite some extended period of time in the future. After purchasing some property, you will still most probably be left with the question of which currency to remain liquid in. I think gold will remain that currency for quite some time... all this talk about an "exit" mystifies me.... as if gold could get in a bubble.

Me 2. Careful your boat isn't overloaded. If it capsizes, don't try to salvage your gold, it will take you straight to the bottom.

Yes, it will if currencies are pegged to gold in the end. I wouldn't worry too much about gold getting in a bubble... or looking for an "exit". That's not to say it couldn't get a bit "frothy" in the short term. If gold shows its characteristic volatility to the downside as well as the upside, many chasing gold up here could also be soon selling.

Trouble is "fundamentals" can mean different things to different people. You have the fundamentals of gold. Then you can have the "fundamentals" of the market, where perceptions and market behaviour rules. Add to those the "fundamentals" of finance, where credit/ leverage can expand and then turn on a dime to contract. Perhaps a truer picture would be found in a "triangulation" of the three, which would also paint a less bleak picture than a possible fall to the 600 handle.

I tend to agree with you if it was a matter of trading and chasing nominal gains. However, hedging your bullion postion by buying some dollars here is perfectly sensible... for those that are already seriously invested. It makes sense if you think gold is vulnerable to a correction, and that you could make real gains by buying on that dip with the cash you have raised. This is not trading [or trying to be clever], where you look to make nominal profits, but being cautious and hedging against lower prices. I wouldn't be buying here at these all times high.... but then that is because I am already seriously "invested" in gold ["interrogated" for Errol]. If I had no gold, I would be buying.

Nah, surely not. All I did was post a few times, using my best language, on the "$5000+ Gold" thread. Must be a case of mistaken identity.

Is anyone having problems accessing HPC? I was following a thread there and get the following message when I try to access the general forum: Does that mean I have been banned? No message. No nothing.... and I think my IP address has been blocked.

Pretty much agree. They were lugging about 200 ounce bars on CNBC the other night. Gartman saying only the naive think gold isn't in a bubble. The implicit message being get on board and ride the bubble up. Makes you wonder how low the dip could go on a sell-off. I am sticking to 900 as there would have to be one hell of a countering pull to the upside, even on a sell-off, and then a quick recover to new heights as the "fundamentals" of gold as currency assert themselves. From: http://www.youtube.com/watch?v=DKbPUzhWeeI